ANET Arista Networks Inc

Arista Networks develops cloud networking solutions used by hyperscalers and large enterprises for ultra-low-latency, high-throughput data center connectivity. Sector: Technology.

Arista Networks Inc (ANET) is an individual stock. The analysis below presents key financial metrics for the company, covering profitability, capital efficiency, valuation, margins, and growth.

From a capital efficiency perspective, ROIC is 113.39%, WACC is 12.52%, and the economic spread is 100.87%. On balance, the company exhibits an exceptional economic spread, compounding intrinsic value at a rate few companies can match. Supporting metrics show ROE at 31.57% and ROA at 17.82%, a combination that helps frame whether profitability strength is broad enough to hold through different market conditions. Taken together, the return profile suggests a company with credible compounding capacity if current operating execution persists.

Multiple analysis puts the company at trailing P/E of 45.98, forward P/E of 35.90, PEG of 1.35. The spread from trailing to forward multiple is wide enough to suggest earnings momentum is a meaningful part of the current valuation case. Growth-adjusted, the company looks reasonably valued — the PEG ratio implies the market is not extrapolating the growth narrative aggressively. The current ratio of 3.05 indicates the company is well-positioned to meet near-term obligations. The combined valuation and liquidity profile points to a company where current prices embed meaningful growth expectations, and where delivery against those expectations will drive the return outcome.

On the margin front: gross margin sits at 64.06%, operating margin at 42.82%, and free cash flow margin at 47.22%. At this gross margin level, the company demonstrates significant pricing power and production efficiency. The operating margin here is a standout — reflecting businesses that convert a large share of gross profit into operating earnings. At this FCF margin level, the company have considerable financial flexibility without reliance on external financing. This margin set supports the view that earnings quality is high and cash generation is not merely accounting-driven.

The two main inputs to the near-term picture — TTM revenue growth of 28.87% reflecting robust top-line expansion across the company. Consensus EPS estimates point to 28.1% earnings growth over the next 12 months — a compelling near-term earnings catalyst that, if delivered, changes the valuation conversation materially. Analyst price targets suggest street expectations point to meaningful upside if execution holds on a 12-month view. Revenue momentum establishes the baseline; analyst price targets reveal how much the market is already paying for future execution on top of that baseline. Delivered returns will ultimately be shaped by the gap — or lack thereof — between operating execution and the expectations embedded in current prices. The estimated 12-month price change is based on analyst consensus price target estimates, sourced from publicly available data, and should not be interpreted as a reliable prediction of future performance.

Across the metrics reviewed, the evidence is consistently constructive — quality, growth, and valuation are pulling in the same direction.

The analysis above draws from quantitative data only and does not constitute personalized financial advice. Investors should conduct independent research and consider professional guidance before acting on any information presented here.